The Next Energy Revolution

Over the last decade, the biggest change in energy was how and where hydrocarbons were removed from the earth. The United States led this change. However, a different kind of energy revolution will take place between now and 2025. While the last decade was about the energy buried in the earth and how to get it out, the next decade will be about how the energy already removed from the earth is moved across it. An energy-transit revolution has begun. The consequences of this next energy revolution will be geopolitical and important. –John Richard Cookson, The National Interest, 4 September 2015

America could soon be exporting a lot of oil. Momentum is building fast on lifting the ban on U.S. oil exports. Some believe the ban may not even live to see its 40th birthday this December. A powerful combination of forces, starting with the massive United States shale oil boom, cheap gas prices and the Iranian nuclear deal is propelling this move much quicker than anybody expected. The effort is picking up a lot of political support in both Houses of Congress. Barton said he hopes to give the American people a “Christmas present” by getting a bill on President Obama’s desk before the end of the year. –Matt Egan, CNN Money, 8 September 2015

In November 2014, the leaders of Saudi Arabia made one of the biggest bets in history. Their strategy was flawed, and they’ve already lost. In an OPEC meeting that month, Saudi Arabia announced it would maintain high oil-production levels despite falling prices. The Saudis were betting that by keeping prices low they could protect their market share and kill America’s energy renaissance—a rebirth driven largely by Texas, which produces 37% of America’s oil and 28% of its marketed natural gas. What the Saudis and the naysayers closer to home seem to have forgotten is that the free market is the greatest incubator of technological innovation. OPEC’s gamble to kill American innovation was a short-term strategy without an endgame, and no appreciation of how the strategy would spur greater efficiencies and innovation in the U.S. Call this a gentle reminder: It is never wise to bet against capitalism, especially in Texas. –Glenn Hegar, The Wall Street Journal, 2 September 2015

For most countries, the economic slowdown in China and the accompanying slump in commodity prices represent something between nuisance and pothole. For Russia, they are a catastrophe. Russia’s currency and economy, already squeezed by Western sanctions, have been sent into virtual free fall by slumping oil prices. The oil collapse has exposed deep cracks in Russia’s economic foundations: falling productivity, a shrinking labor force, uncompetitive industries, and private enterprise hemmed in by a kleptocratic state and crony capitalism. The loss of that wealth threatens to scramble the world’s geopolitical order, though there are no signs of that yet. There are parallels to the events that toppled the Soviet Union. Until the 1970s, oil and gas didn’t dominate the Soviet economy. But its days were numbered. –Greg Ip, The Wall Street Journal, 2 September 2015

Britain faces potential power shortages in the next four years. According to Mr Atherton the problem started with the Labour government under the former Prime Minister Tony Blair which committed Britain to unachievable targets for building renewable energy capacity. The suspicion is that Mr Blair went into European climate talks in 2007 not even knowing the difference between energy ‚Äì which covered everything from transportation to home insulation ‚Äì and electricity. Almost a decade later, this possible schoolboy error by Mr Blair and his negotiating team could lead to blackouts for the “first time in living memory”, Mr Atherton believes. –Andrew Critchlow, The Sunday Telegraph, 6 September 2015